By Andria Cheng

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In a surprise announcement, Macy’s Inc., considered an outperformer in the department store sector, on Wednesday said it plans to cut 2,500 jobs, shut five underperforming stores and consolidate districts as it shifts resources with an increased focus on integrating online and in-store sales.

The layoffs stem from the company’s plans to reducing the number of districts, and to eliminate district planners for home furnishings, an area where the company said tastes are fairly steady, therefore the inventory doesn’t require as much planning as other sectors like apparel. Other job cuts will come from store-level employees and the consolidation of certain central office, administrative and back-office functions. Macy’s said that, as it invests in online operations and new stores, it still expects to have a total of 175,000 employees. As the company shuts five stores this spring, it said it will add five new stores under the Macy’s banner and three under its Bloomingdale’s brand.

“Our company has significantly increased sales and profitability over the past four years, and we have created a culture of growth at Macy’s,” said Chief Executive Terry Lundgren. “We began five years ago with a set of business strategies that were largely untested by a national retailer of our size and scope. As the success of these strategies has unfolded, we have identified some specific areas where we can improve our efficiency without compromising our effectiveness in serving the evolving needs of our customers.”

He said the restructuring is in line with the company’s strategy to tailor merchandise to local market demands, introduce better customer-service training and integrate online and in-store sales, including fulfilling online orders from stores.

The company also gave an update on its holiday sales. Same-store sales in November and December rose 3.6% and were up 4.3% when factoring in departments licensed to third parties. The company narrowed its second-half sales guidance to a range of 2.8% to 2.9%, from its prior guidance predicting an increase of between 2.5% and 4%. That equates to a fourth-quarter sales increase of 2.3% to 2.5%, Macy’s said. Analysts surveyed by Retail Metrics were looking for a sales gain of 2.6%.

However, while sales may disappoint, Macy’s gave investors some comfort amid fears that deep holiday discounting may have hurt retailers’ profit margin. Macy’s kept its full-year profit outlook of $3.80 to $3.90 a share. It forecast same-store sales this year to rise 2.5% to 3% with per-share profit of $4.40 to $4.50 a share. Analysts were looking for profit of $3.87 a share last year and $4.36 a share this year, according to FactSet.

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About Behind the Storefront

Behind the Storefront is a blog about all things retail. It’s aimed at investors, shoppers and anyone else with a passion for learning about what drives consumer behavior. Hosted by Andria Cheng, Behind the Storefront will cover the business, brands and shopping behavior that’s behind some of the biggest companies, and largest employers, in the world. You can reach Andria at Acheng@marketwatch.com.